Monday, April 02, 2007

EMI Goes DRM-Free, Jobs Expects Other Labels to Follow

The reports that the music industry is dying may have been premature.

Today in London, Steve Jobs and EMI announced that the music label will make its entire digital music catalog available DRM-free beginning in May (excluding The Beatles' music). This move comes almost 2 months after Steve Jobs made a plea to the music industry to dump DRM completely. The RIAA balked at the suggestion, but EMI quickly announced that they were indeed considering this move. Apparently they are considering it no more, it's now about to become reality.

iTunes will get first shot at selling EMI's tracks DRM-free beginning in May. The tracks will sell for an additional 30 cents, at $1.29, and customers that have previously purchased tracks by EMI artists can 'upgrade' their track for 30 cents. The upgrade gets you a DRM-free version, and superior sound quality as the DRM-free tracks have a bitrate of 256Kbps, compared to the 128Kbps for standard iTunes tracks.

Somewhat lost in the hype over EMI losing its DRM, is that Jobs added during today's joint presentation with the label that he expects HALF of the tunes available on iTunes to be DRM-free by year's end. He also added that he will reach out to other labels beginning today to offer them the same deal.

This is a huge publicity coup for both Jobs and EMI. It will put pressure on other labels to follow suit, but also gives the labels the price increase that they were demanding. And the fact that this deal is happening is almost a pseudo-admission by EMI that they realize that music piracy isn't going to cripple their business as labels have claimed since Napster became popular in the late 90s. In fact it should be a boon for EMI's artists, as anything that makes it easier to distribute digital music, leads to more sales.

As EMI is about to find out. When they do, look for the other biggies to follow suit.

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J.D. said...

I don't know, Mack. I'd have been okay with this had they not jumped up the price by 30%. Honestly, if you're purchasing a whole album, assuming your CD is an average of 15 songs long, you're looking at paying more than $19 per CD. At that price, I'd rather jump in the car, head to Target, get the same disc, same/better sound quality, for $13 and a jewel case and pretty liner to boot. I just can't see paying the extra for something digital (non-tangible) that's not costing anything extra to construct.

I think that most consumers are smart enough to see they'd save money, and I believe that the higher prices are going to make piracy look even more attractive.

Then again, maybe the labels know this, and perhaps they're following a path that they know is going to fail so they can justify the position they've held all along. Something to think about.

gianandrea said...

mack, i suppose that a huge role in this was played by the european community which made a statement about the locked system in itunes.
note that the first agreement was taken with a european label.